GE: Not liable for more dredging

DiNapoli told it won't expand Hudson River PCB cleanup; silent on canal work

Published 9:28 pm, Friday, December 27, 2013

Albany

General Electric Co. told state Comptroller Tom DiNapoli on Friday that the company foresees no legal liability that might force it to expand its federally ordered cleanup of the Hudson River, even as some state and local officials are calling for the project to include the PCB-impaired navigation channel of the state's Champlain Canal.

In its 31-page report, GE does not mention the canal as something that could — or could not be — part of a so-called "natural resources damages claim" that has remained under study for more than a decade by the state and two federal agencies.

"GE does not believe there is basis to conclude that the company will have significant NRD (natural resource damages) liability that warrants expanded dredging," according to a letter to DiNapoli from GE Vice President Ann Klee. The report cited studies that have found fish, birds and other wildlife are thriving on the upper Hudson River, where GE is dredging about 40 miles of river bottom from Fort Edward to Troy under the federal Superfund pollution cleanup program.

This spring, DiNapoli asked GE to address the issue of future potential liability for an expanded cleanup, acting in his role as overseer of the state pension fund, which holds more than $767 million in GE stock.

"We are assessing this report and its potential impact on shareholder value. We will give careful consideration to appropriate next steps as we move forward with our review," DiNapoli spokesman Eric Sumberg said Friday.

At issue are up to 136 acres of river bottom that contain pockets of PCBs, but are not scheduled to be cleaned under a 500-acre agreement reached in 2005 by GE and the U.S. Environmental Protection Agency. Part of what would be left undredged includes the canal's navigation channel, which has not been cleared in more than three decades because the state Canal Corporation could not handle toxic PCBs. That has left the channel too shallow for nearly all commercial traffic.

After years of pushing to have the navigation channel added to the GE project, the cash-strapped Canal Corporation announced this spring it would start planning the work itself, without a clear way to pay the estimated $180 million price tag. The 60-mile canal runs from Whitehall, near the tip of Lake Champlain's South Bay, south to Fort Edward where it joins the Hudson and proceeds through a series of six locks and dams to Waterford.

This month, frustration over the absence of a dredging solution for the canal bubbled up at a meeting of the EPAadvisory group that oversees the Hudson project. Julie Stokes, a representative of the Saratoga County Chamber of Commerce, and several other Citizens' Advisory Group members expressed concern that with the dredging project now slated to end in 2015 — at least a year early — time is running out to address the canal while the dredging equipment assembled by GE remains in place.

In 2000, then-Attorney General Eliot Spitzer sued GE to dredge PCBs from the canal, but that lawsuit was dismissed as premature with an EPA agreement. The issue has remained under study by Spitzer's successors, but no similar lawsuit has ensued.

GE's view that it foresees no significant liability that might portend expanded dredging comes as state Attorney General Eric Schneiderman has been negotiating with GE behind closed doors over the canal.

This spring, Schneiderman confirmed statements by Canal Corporation Director Brian Stratton, who told Bloomberg News that GE was in talks with Schneiderman and Gov. Andrew Cuomo's office. At that time, a GE spokesman denied such talks existed

Schneiderman's office declined comment late Friday. Attempts to contact the Canal Corporation for comment were not successful.

The Canal Corporation stopped dredging the canal's navigation channel in 1980 because of PCBs.

As the channel silted in, it became too shallow for most cargo shipping. Commercial traffic plummeted from 700,000 tons in 1980 to less than 1,000 tons annually since the mid-1990s.